There's a lot of friction when working with crypto and a lot of that is thanks to its fundamental design to enforce stringent asset security.
The problem with this fundamental buildup of crypto tokens/assets on blockchain networks is that it is directly a trade off, attaining top security on the protocol layer effectively leads to having a highly complex investment environment with low flexibility.
Dealing with crypto means self-custodianship, as a first rule of asset security within the ecosystem. Keeping watch of one's yard of investment should not necessarily be a problem but when that involves save keeping random strings of letters and numbers or fuckin 24 words phrases, that becomes a hell of a job that quickly gets tiresome.
With every new blockchain network coming into the picture, leading to new products and services being released, the friction increases.
More advancement in investment offerings equals intense gatekeeping requirements.
Sadly, this is one aspect of crypto that we can't quite flip a switch and solve the flaw at this point - personally, it's one we shouldn't be in a hurry to solve even if that means low adoption, it can wait.
That said, there are several other aspects of crypto that needs immediate attention and that is:
Cross-blockchain Transactions
According to Defillama.com, cross-chain bridge vulnerabilities resulted in over $2.83 billion stolen from the crypto ecosystem.
Given how centralized these bridges are, they've served as a honeypot for attackers looking to extract as much value from ecosystems.
Cross-chain transactions with top security remains an unsolved crypto flaw, limiting the potential of decentralized finance across blockchains.
Blockchain interoperability is crucial for a resilient crypto economy. As the number of blockchains increases, the urgency for secure cross-network communication layer heightens.
For blockchain to be a widely adopted network for building businesses, products or services for future generations, secure and efficient inter-chain communications ought to be solved.
Of a surety, DeFi stands as the current biggest demanding sector for secure interoperability frameworks, however, the use cases goes beyond “basic monetary transactions” as it is evident that the economy surrounding the creation, management and use of data is about to explode with artificial intelligence on the line.
Building infrastructures that allows for blockchains to scale future business ventures is essentially for sustainable, scalable and resilient economies.
Chainlink's CCIP, the future of blockchain interoperability?
Chainlink has been nothing short of an amazing addition to the crypto ecosystem, at least from the way I see it.
One of the insights I've gained from reading a little more about how Chainlink works and what is being built/developed in that ecosystem is that Chainlink is actually not like any “regular” blockchain.
Of course, I've known that it's primary function has been the whole “Oracle Business” so no, not that differentiation, that's a greatly oversimplified way of explaining what Chainlink is.
Paying close attention to the name itself should send a message.
Chainlink's actual buildup is about creating an environment of independent networks, unlike regular blockchains having one network with independent nodes, Chainlink is no network but a group of networks.
That said, the blockchain oracle service provider recently debuted a blockchain interoperability solution called the Chainlink Cross-Chain Interoperability Protocol (CCIP).
Given that Chainlink is heavy on data as a service of independent networks, there's a great deal of focus on security pushed onto the development of this protocol, so much so that it is claimed to be the only interoperability protocol with level-5 security.
Fuck is level-5 security?
Regular interoperability protocols, or let's just call them bridges, are really just centralized servers controlled by a single entity with a single private key.
Sometimes, we could have two or more servers handling shits but control still remains under one keyholder.
Such systems are by design, attractive to attackers.
Ethereum co-founder Vitalik Buterin has criticized cross-chain infrastructure in the past. In a Reddit post from January 2022, Buterin shared his concerns about how 51% attacks on cross-chain bridges will become more prevalent in the future:
“The more usage of cross-chain bridges and apps there is, the worse the problem becomes. No one will 51% attack Ethereum just to steal 100 Solana-WETH... But if there are 10 million ETH or SOL in the bridge, then the motivation to make an attack becomes much higher, and large pools may well coordinate to make the attack happen.”
cointelegraph.com
Chainlink claims to solve this problem with its CCIP as this protocol leverages several security measures employed by other Chainlink products to secure cross-chain transactions. One of such security measures include the monitoring and mitigation of threats. Chainlink's CCIP manages risks by utilizing multiple decentralized networks to secure a single cross-chain transaction thereby implementing emergency shutdowns or imposing rate limits. By the reported design, Chainlink CCIP offers an interoperability protocol secured by multiple independent nodes run by independent key holders. Three decentralized networks all executing and verifying every bridge transaction, separation of responsibilities, with distinct sets of node operators, and with no nodes shared between the transactional DONs and the Risk Management Network. Increased decentralization with two separate code bases across two different implementations, written in two different languages to create a previously unseen diversity of software clients in the bridging world. And Never-before-seen level of risk management that can be rapidly adapted to any new risks or attacks that appear for cross-chain bridging. As outlined here
Several DeFi protocols have reportedly already begun using this interoperability protocol and at this point, it's left to see how it lives up the Chainlink's reputation of securely validating trillions of dollars worth of transactions. A signal to buy LINK ? As ever, Not Financial Advice! Images created with ideogram ai